011-2005-Southern Cross Cement Corp. v. Cement20210505-13-1ql6utx
011-2005-Southern Cross Cement Corp. v. Cement20210505-13-1ql6utx
SYLLABUS
1.TAXATION; COURT OF TAX APPEALS (CTA); SECTION 29 OF THE
SAFEGUARD MEASURES ACT (SMA); VESTS JURISDICTION ON THE COURT OF
TAX APPEALS OVER PETITIONS QUESTIONING THE NON-IMPOSITION BY THE
DEPARTMENT OF TRADE SECRETARY OF SAFEGUARD MEASURES. —” It should
be emphasized again that by utilizing the phrase "in connection with," it is the
SMA that expressly vests jurisdiction on the CTA over petitions questioning the
non-imposition by the DTI Secretary of safeguard measures. The Court is simply
asserting, as it should, the clear intent of the legislature in enacting the SMA.
Without "in connection with" or a synonymous phrase, the Court would be
compelled to favor the respondents' position that only rulings imposing
safeguard measures may be elevated on appeal to the CTA. But considering
that the statute does make use of the phrase, there is little sense in delving
into alternate scenarios. Respondents fail to convincingly address the absurd
consequences pointed out by the Decision had their proposed interpretation
been adopted. Indeed, suffocated beneath the respondents' legalistic tinsel is
the elemental question —” what sense is there in vesting jurisdiction on the
CTA over a decision to impose a safeguard measure, but not on one choosing
not to impose. Of course, it is not for the Court to inquire into the wisdom of
legislative acts, hence the rule that jurisdiction must be expressly vested and
not presumed. Yet ultimately, respondents muddle the issue by making it
appear that the Decision has uniquely expanded the jurisdictional rules. For the
respondents, the proper statutory interpretation of the crucial phrase "in
connection with" is to pretend that the phrase did not exist at all in the statute.
The Court, in taking the effort to examine the meaning and extent of the
phrase, is merely giving breath to the legislative will.
2.ID.; ID.; ID.; QUESTION OF WHETHER OR NOT A TARIFF SHOULD BE
IMPOSED IS AN ISSUE FRAUGHT WITH A TAX DIMENSION, DETERMINATION OF
WHICH CALL UPON THE SAME KIND OF EXPERTISE THAT A SPECIALIZED BODY
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AS THE CTA PRESUMABLY POSSESSES. —” Philcemcor imputes intelligent
design behind the alleged intent of Congress to limit CTA review only to
impositions of the general safeguard measures. It claims that there is a
necessary tax implication in case of an imposition of a tariff where the CTA's
expertise is necessary, but there is no such tax implication, hence no need for
the assumption of jurisdiction by a specialized agency, when the ruling rejects
the imposition of a safeguard measure. But of course, whether the ruling under
review calls for the imposition or non-imposition of the safeguard measure, the
common question for resolution still is whether or not the tariff should be
imposed —” an issue definitely fraught with a tax dimension. The
determination of the question will call upon the same kind of expertise that a
specialized body as the CTA presumably possesses.
3.ID.; ID.; ID.; CLAIM THAT THE COURT OF TAX APPEALS MAY NOT
EXERCISE JUDICIAL REVIEW OVER A DECISION NOT TO IMPOSE A SAFEGUARD
MEASURE FINDS NO STATUTORY SUPPORT. —” In response to the Court's
observation that the setup proposed by respondents was novel, unusual,
cumbersome and unwise, public respondents invoke the maxim that courts
should not be concerned with the wisdom and efficacy of legislation. But this
prescinds from the bogus claim that the CTA may not exercise judicial review
over a decision not to impose a safeguard measure, a prohibition that finds no
statutory support. It is likewise settled in statutory construction that an
interpretation that would cause inconvenience and absurdity is not favored.
Respondents do not address the particular illogic that the Court pointed out
would ensue if their position on judicial review were adopted. According to the
respondents, while a ruling by the DTI Secretary imposing a safeguard measure
may be elevated on review to the CTA and assailed on the ground of errors in
fact and in law, a ruling denying the imposition of safeguard measures may be
assailed only on the ground that the DTI Secretary committed grave abuse of
discretion. As stressed in the Decision, "[c]ertiorari is a remedy narrow in its
scope and inflexible in its character. It is not a general utility tool in the legal
workshop."
4.ID.; ID.; ID.; INTERESTED PARTIES ARE NOT LEFT WITHOUT ANY
EFFECTIVE REMEDY SHOULD THE TARIFF COMMISSION ACT OR CONCLUDE
ERRONEOUSLY IN MAKING ITS DETERMINATION WHETHER THE FACTUAL
CONDITIONS EXIST WHICH NECESSITATE THE IMPOSITION OF THE GENERAL
SAFEGUARD MEASURE; AS AN INSTRUMENTALITY OF THE GOVERNMENT, THE
ACTIONS OF THE TARIFF COMMISSION ARE NOT BEYOND THE PALE OF
CERTIORARI JURISDICTION. —” It is incorrect to say that the Decision bars any
effective remedy should the Tariff Commission act or conclude erroneously in
making its determination whether the factual conditions exist which necessitate
the imposition of the general safeguard measure. If the Tariff Commission
makes a negative final determination, the DTI Secretary, bound as he is by this
negative determination, has to render a decision denying the application for
safeguard measures citing the Tariff Commission's findings as basis.
Necessarily then, such negative determination of the Tariff Commission being
an integral part of the DTI Secretary's ruling would be open for review before
the CTA, which again is especially qualified by reason of its expertise to
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examine the findings of the Tariff Commission. Moreover, considering that the
Tariff Commission is an instrumentality of the government, its actions (as
opposed to those undertaken by the DTI Secretary under the SMA) are not
beyond the pale of certiorari jurisdiction. Unfortunately for Philcemcor, it hinged
its cause on the claim that the DTI Secretary's actions may be annulled on
certiorari, notwithstanding the explicit grant of judicial review over that cabinet
member's actions under the SMA to the CTA.
5.ID.; ID.; ID.; SECTION 29 OF THE SAFEGUARD MEASURES ACT
EXPRESSLY CONFERS CTA JURISDICTION OVER RULINGS IN CONNECTION WITH
THE IMPOSITION OF THE SAFEGUARD MEASURE, AND THE REASSERTION OF
THE SAID MATTER IN THE COURT'S DECISION WAS A MATTER OF EMPHASIS,
NOT OF CONTRIVANCE. —” Philcemcor argues that assuming this Court's
interpretation of Section 29 is correct, such ruling should not be given
retroactive effect, otherwise, a gross violation of the right to due process would
be had. This erroneously presumes that it was this Court, and not Congress,
which vested jurisdiction on the CTA over rulings of non-imposition rendered by
the DTI Secretary. We have repeatedly stressed that Section 29 expressly
confers CTA jurisdiction over rulings in connection with the imposition of the
safeguard measure, and the reassertion of this point in the Decision was a
matter of emphasis, not of contrivance. The due process protection does not
shield those who remain purposely blind to the express rules that ensure the
sporting play of procedural law. Besides, respondents' claim would also apply
every time this Court is compelled to settle a novel question of law, or to
reverse precedent. In such cases, there would always be litigants whose causes
of action might be vitiated by the application of newly formulated judicial
doctrines. Adopting their claim would unwisely force this Court to treat its
dispositions in unprecedented, sometimes landmark decisions not as
resolutions to the live cases or controversies, but as legal doctrine applicable
only to future litigations.
7.ID.; ID.; ID.; WITHOUT SECTION 28 (2), ARTICLE VI, OF THE 1987
CONSTITUTION, THE EXECUTIVE BRANCH HAS NO AUTHORITY TO IMPOSE
TARIFFS AND OTHER SIMILAR TAX LEVIES INVOLVING THE IMPORTATION OF
FOREIGN GOODS. —” Without Section 28 (2), Article VI, the executive branch
has no authority to impose tariffs and other similar tax levies involving the
importation of foreign goods. Assuming that Section 28 (2) Article VI did not
exist, the enactment of the SMA by Congress would be voided on the ground
that it would constitute an undue delegation of the legislative power to tax. The
constitutional provision shields such delegation from constitutional infirmity,
and should be recognized as an exceptional grant of legislative power to the
President, rather than the affirmation of an inherent executive power. This
being the case, the qualifiers mandated by the Constitution on this presidential
authority attain primordial consideration. First, there must be a law, such as the
SMA. Second, there must be specified limits, a detail which would be filled in by
the law. And further, Congress is further empowered to impose limitations and
restrictions on this presidential authority. On this last power, the provision does
not provide for specified conditions, such as that the limitations and restrictions
must conform to prior statutes, internationally accepted practices, accepted
jurisprudence, or the considered opinion of members of the executive branch.
8.ID.; ID.; ID.; THE TARIFF COMMISSION AND THE DEPARTMENT OF TRADE
AND INDUSTRY SECRETARY MAY BE REGARDED AS AGENTS OF CONGRESS
WITHIN THEIR LIMITED RESPECTIVE SPHERES, AS ORDAINED IN THE
SAFEGUARD MEASURES ACT, IN THE IMPLEMENTATION OF THE LAW WHICH
SIGNIFICANTLY DRAWS ITS STRENGTH FROM THE PLENARY LEGISLATIVE POWER
OF TAXATION. —” The Court recognizes that the authority delegated to the
President under Section 28 (2), Article VI may be exercised, in accordance with
legislative sanction, by the alter egos of the President, such as department
secretaries. Indeed, for purposes of the President's exercise of power to impose
tariffs under Article VI, Section 28 (2), it is generally the Secretary of Finance
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who acts as alter ego of the President. The SMA provides an exceptional
instance wherein it is the DTI or Agriculture Secretary who is tasked by
Congress, in their capacities as alter egos of the President, to impose such
measures. Certainly, the DTI Secretary has no inherent power, even as alter
ego of the President, to levy tariffs and imports. Concurrently, the tasking of
the Tariff Commission under the SMA should be likewise construed within the
same context as part and parcel of the legislative delegation of its inherent
power to impose tariffs and imposts to the executive branch, subject to
limitations and restrictions. In that regard, both the Tariff Commission and the
DTI Secretary may be regarded as agents of Congress within their limited
respective spheres, as ordained in the SMA, in the implementation of the said
law which significantly draws its strength from the plenary legislative power of
taxation. Indeed, even the President may be considered as an agent of
Congress for the purpose of imposing safeguard measures. It is Congress, not
the President, which possesses inherent powers to impose tariffs and imposts.
Without legislative authorization through statute, the President has no power,
authority or right to impose such safeguard measures because taxation is
inherently legislative, not executive.
9.ID.; ID.; ID.; POSITIVE FINAL DETERMINATION BY TARIFF COMMISSION
PLAINLY REQUIRED BY SECTION 5 OF THE SAFEGUARD MEASURES ACT. —”
There is no question that Section 5 of the SMA operates as a limitation validly
imposed by Congress on the presidential authority under the SMA to impose
tariffs and imposts. That the positive final determination operates as an
indispensable requisite to the imposition of the safeguard measure, and that it
is the Tariff Commission which makes such determination, are legal
propositions plainly expressed in Section 5 for the easy comprehension for
everyone but respondents.
12.ID.; ID.; ID.; IT IS EVIDENT FROM SECTION 5 OF THE SMA THAT THERE
MUST BE A POSITIVE FINAL DETERMINATION BY THE TARIFF COMMISSION THAT
A PRODUCT IS BEING IMPORTED INTO THE COUNTRY IN INCREASED
QUANTITIES AS TO BE A SUBSTANTIAL CAUSE OF SERIOUS INJURY OR THREAT
TO THE DOMESTIC INDUSTRY; ANY DISPUTATION TO THE CONTRARY IS, AT
BEST, THE PRODUCT OF WISHFUL THINKING. —” It will not be difficult,
especially as to heavily-debated legislation, for two sides with contrapuntal
interpretations of a statute to highlight their respective citations from the
legislative debate in support of their particular views. A futile exercise of
second-guessing is happily avoided if the meaning of the statute is clear on its
face. It is evident from the text of Section 5 that there must be a positive final
determination by the Tariff Commission that a product is being imported into
the country in increased quantities (whether absolute or relative to domestic
production), as to be a substantial cause of serious injury or threat to the
domestic industry. Any disputation to the contrary is, at best, the product of
wishful thinking.
10.ID.; ID.; AS THE PRESIDENT'S ALTER EGO ON TRADE MATTERS, THE DTI
SECRETARY EXERCISES, IN THE PRESIDENT'S STEAD, THE SAME PREROGATIVE
OF AFFIRMATION, MODIFICATION OR REVERSAL OVER ANY ACTION OF THE
TARIFF COMMISSION. —” [I]n imposing a safeguard measure, the DTI secretary
acts as the President's alter ego. Because the President's power of control over
any office in the Executive Department cannot be restricted or degraded by
Congress, by the same reasoning the exercise by the alter ego of such power of
control over actions of the Tariff Commission cannot be constitutionally
curtailed by Congress. Otherwise stated, the President —” through the
constitutional power of control over the Executive Department —” has the
prerogative to affirm, modify or reverse any action of the Tariff Commission.
Thus, the DTI secretary —” as the President's alter ego on trade matters —”
may exercise, in the President's stead, the same prerogative of affirmation,
modification or reversal over any action of the Commission.
11.ID.; ID.; DECISION TO IMPOSE A SAFEGUARD MEASURE HINGES ON
PUBLIC INTEREST, WHICH IS A POLITICAL QUESTION BEST ADDRESSED BY
ELECTED OFFICIALS LED BY THE PRESIDENT. —” [T]he congressional limitation
on the exercise of the delegated authority to impose safeguards does NOT refer
to the final determination or recommendation of the Tariff Commission that the
first two factual conditions are present or absent. Of course, these are
important considerations that are verifiable from the records of the proceedings
undertaken by the Commission. These data must be weighed accordingly. In
the same vein, many immeasurable and indirect variables have to be assessed
in ensuring that public interest is subserved. In the final analysis, the decision
to impose a safeguard measure hinges on public interest, which is a political
question best addressed by our people's elected officials led by the President.
14.ID.; ID.; ID.; THE SECRETARY OF TRADE AND INDUSTRY CAN REJECT
BOTH A POSITIVE AND NEGATIVE FINAL DETERMINATION OF THE TARIFF
COMMISSION. —” [U]nder petitioner's submission (upheld by the Second
Division) that the DTI secretary may impose the measure only upon a positive
determination by the Tariff Commission, a violation of due process would be
more probable in case of a negative determination by the latter. Following the
ponencia's literal interpretation of the law, the aggrieved party (the applicant)
in such a situation would be left with absolutely no recourse. A negative report
will then be not reviewable by anyone —” not by the DTI secretary who is
bound by it; not by the President, who has no direct role in the proceeding
defined under the law; and not by the courts, which may review only the DTI
secretary's decisions. Such a scheme of things constitutes an utter disregard of
the guarantee of due process under the Constitution. The ponencia even goes
further by declaring that "nothing in the SMA obliges the DTI [s]ecretary to
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adopt the recommendations made by the Tariff Commission." If the trade
secretary can reject a positive final determination of the Commission, what is
the rationale behind binding him to a negative determination by the same
body? I cannot think of more illogic.
15.ID.; ID.; ID.; OBJECT AND PURPOSE OF RA 8800 SHOULD BE GIVEN
UTMOST CONSIDERATION AND EFFECT; IN THE IMPOSITION OF SAFEGUARD
MEASURES, NOT ONLY THE ANALYSIS OF TECHNICAL DATA IS INVOLVED BUT
LIKEWISE THE DETERMINATION THAT IT SERVES PUBLIC INTEREST. —” [T]he
object and purpose of RA 8800 should be given utmost consideration and
effect. The law was enacted primarily to protect or safeguard local industries
and producers from increased importation of foreign products, which cause or
threaten to cause serious domestic injury. RA 8800 was intended to secure our
local industry from the ill effects of global trade liberalization. It was aimed at
protecting Filipino interests vis-Ã -vis international trade policies. Toward these
ends, I believe this Court must give domestic industries every opportunity to
seek redress through the most expeditious means possible. On matters
concerning policy questions, it must allow the political departments ample
chances to make the proper determinations within their respective spheres of
competencies. Be it remembered that in the imposition of safeguard measures,
not only the analysis of technical data is involved but likewise, and perhaps in a
more crucial sense, the determination that it serves the public interest. The
proceeding does not merely relate to the settlement of conflicting claims of
private parties but, more important, the achievement of the national policy to
promote the competitiveness of domestic industries as a whole. In short, we
must give essence to the aim of the law to advance the industrial development
of the country.
RESOLUTION
TINGA, J : p
Cement is hardly an exciting subject for litigation. Still, the parties in this
case have done their best to put up a spirited advocacy of their respective
positions, throwing in everything including the proverbial kitchen sink. At
present, the burden of passion, if not proof, has shifted to public respondents
Department of Trade and Industry (DTI) and private respondent Philippine
Cement Manufacturers Corporation (Philcemcor), 1 who now seek
reconsideration of our Decision dated 8 July 2004 (Decision), which granted the
petition of petitioner Southern Cross Cement Corporation (Southern Cross).
This case, of course, is ultimately not just about cement. For respondents,
it is about love of country and the future of the domestic industry in the face of
foreign competition. For this Court, it is about elementary statutory
construction, constitutional limitations on the executive power to impose tariffs
and similar measures, and obedience to the law. Just as much was asserted in
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the Decision, and the same holds true with this present Resolution .
An extensive narration of facts can be found in theDecision. 2 As can well
be recalled, the case centers on the interpretation of provisions of Republic Act
No. 8800, the Safeguard Measures Act ("SMA"), which was one of the laws
enacted by Congress soon after the Philippines ratified the General Agreement
on Tariff and Trade (GATT) and the World Trade Organization (WTO) Agreement.
3 The SMA provides the structure and mechanics for the imposition of
The DTI sought the opinion of the Secretary of Justice whether it could still
impose a definitive safeguard measure notwithstanding the negative finding of
the Tariff Commission. After the Secretary of Justice opined that the DTI could
not do so under the SMA, 8 the DTI Secretary then promulgated a Decision 9
wherein he expressed the DTI's disagreement with the conclusions of the Tariff
Commission, but at the same time, ultimately denying Philcemcor's application
for safeguard measures on the ground that the he was bound to do so in light
of the Tariff Commission's negative findings. 10
Philcemcor challenged this Decision of the DTI Secretary by filing with the
Court of Appeals a Petition for Certiorari, Prohibition and Mandamus 11 seeking
to set aside the DTI Decision, as well as the Tariff Commission's Report. It
prayed that the Court of Appeals direct the DTI Secretary to disregard the
Report and to render judgment independently of the Report. Philcemcor argued
that the DTI Secretary, vested as he is under the law with the power of review,
is not bound to adopt the recommendations of the Tariff Commission; and, that
the Report is void, as it is predicated on a flawed framework, inconsistent
inferences and erroneous methodology. 12
On 23 June 2003, Southern Cross filed the present petition, arguing that
the Court of Appeals has no jurisdiction over Philcemcor's petition, as the
proper remedy is a petition for review with the CTA conformably with the SMA,
and; that the factual findings of the Tariff Commission on the existence or non-
existence of conditions warranting the imposition of general safeguard
measures are binding upon the DTI Secretary. AICHaS
Despite the fact that the Court of Appeals' Decision had not yet become
final, its binding force was cited by the DTI Secretary when he issued a new
Decision on 25 June 2003, wherein he ruled that in light of the appellate court's
Decision, there was no longer any legal impediment to his deciding
Philcemcor's application for definitive safeguard measures. 17 He made a
determination that, contrary to the findings of the Tariff Commission, the local
cement industry had suffered serious injury as a result of the import surges. 18
Accordingly, he imposed a definitive safeguard measure on the importation of
gray Portland cement, in the form of a definitive safeguard duty in the amount
of P20.60/40 kg. bag for three years on imported gray Portland Cement. 19
On 7 July 2003, Southern Cross filed with the Court a "Very Urgent
Application for a Temporary Restraining Order and/or A Writ of Preliminary
Injunction" ("TRO Application"), seeking to enjoin the DTI Secretary from
enforcing his Decision of 25 June 2003 in view of the pending petition before
this Court. Philcemcor filed an opposition, claiming, among others, that it is not
this Court but the CTA that has jurisdiction over the application under the law.
On 1 August 2003, Southern Cross filed with the CTA a Petition for Review ,
assailing the DTI Secretary's 25 June 2003 Decision which imposed the definite
safeguard measure. Yet Southern Cross did not promptly inform this Court
about this filing. The first time the Court would learn about this Petition with the
CTA was when Southern Cross mentioned such fact in a pleading dated 11
August 2003 and filed the next day with this Court. 20
Philcemcor argued before this Court that Southern Cross had deliberately
and willfully resorted to forum-shopping; that the CTA, being a special court of
limited jurisdiction, could only review the ruling of the DTI Secretary when a
safeguard measure is imposed; and that the factual findings of the Tariff
Commission are not binding on the DTI Secretary. 21
After giving due course to Southern Cross's Petition, the Court called the
case for oral argument on 18 February 2004. 22 At the oral argument, attended
by the counsel for Philcemcor and Southern Cross and the Office of the Solicitor
General, the Court simplified the issues in this wise: (i) whether the Decision of
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the DTI Secretary is appealable to the CTA or the Court of Appeals; (ii)
assuming that the Court of Appeals has jurisdiction, whether its Decision is in
accordance with law; and, whether a Temporary Restraining Order is warranted.
23
After the parties had filed their respective memoranda, the Court's
Second Division, to which the case had been assigned, promulgated its Decision
granting Southern Cross's Petition. 24 The Decision was unanimous, without any
separate or concurring opinion.
The Court ruled that the Court of Appeals had no jurisdiction over
Philcemcor's Petition, the proper remedy under Section 29 of the SMA being a
petition for review with the CTA; and that the Court of Appeals erred in ruling
that the DTI Secretary was not bound by the negative determination of the
Tariff Commission and could therefore impose the general safeguard measures,
since Section 5 of the SMA precisely required that the Tariff Commission make
a positive final determination before the DTI Secretary could impose these
measures. Anent the argument that Southern Cross had committed forum-
shopping, the Court concluded that there was no evident malicious intent to
subvert procedural rules so as to match the standard under Section 5, Rule 7 of
the Rules of Court of willful and deliberate forum shopping. Accordingly, the
Decision of the Court of Appeals dated 5 June 2003 was declared null and void.
The Court likewise found it necessary to nullify the Decision of the DTI
Secretary dated 25 June 2003, rendered after the filing of this present Petition.
This Decision by the DTI Secretary had cited the obligatory force of the null and
void Court of Appeals' Decision, notwithstanding the fact that the decision of
the appellate court was not yet final and executory. Considering that the
decision of the Court of Appeals was a nullity to begin with, the inescapable
conclusion was that the new decision of the DTI Secretary, prescinding as it did
from the imprimatur of the decision of the Court of Appeals, was a nullity as
well.
After the Decision was reported in the media, there was a flurry of
newspaper articles citing alleged negative reactions to the ruling by the counsel
for Philcemcor, the DTI Secretary, and others. 25 Both respondents promptly
filed their respective motions for reconsideration.
aICHEc
The petition for review shall comply with the same requirements
and shall follow the same rules of procedure and shall be subject to the
same disposition as in appeals in connection with adverse rulings on
tax matters to the Court of Appeals. 32 (Emphasis supplied)
The matter is crucial for if the CTA properly had jurisdiction over the
petition challenging the DTI Secretary's ruling not to impose a safeguard
measure, then the special civil action of certiorari resorted to instead by
Philcemcor would not avail, owing to the existence of a plain, speedy and
adequate remedy in the ordinary course of law. 33 The Court of Appeals, in
asserting that it had jurisdiction, merely cited the general rule on certiorari
jurisdiction without bothering to refer to, or possibly even study, the import of
Section 29. In contrast, this Court duly considered the meaning and
ramifications of Section 29, concluding that it provided for a plain, speedy and
adequate remedy that Philcemcor could have resorted to instead of filing the
special civil action before the Court of Appeals.
Philcemcor still holds on to its hypothesis that the petition for review
allowed under Section 29 lies only if the DTI Secretary's ruling imposes a
safeguard measure. If, on the other hand, the DTI Secretary's ruling is not to
impose a safeguard measure, judicial review under Section 29 could not be
resorted to since the provision refers to rulings "in connection with the
imposition" of the safeguard measure, as opposed to the non-imposition.
Since the Decision dated 5 April 2002 resolved against imposing a safeguard
measure, Philcemcor claims that the proper remedial recourse is a petition for
certiorari with the Court of Appeals.
Interestingly, Republic Act No. 9282, promulgated on 30 March 2004,
expressly vests unto the CTA jurisdiction over "[d]ecisions of the Secretary of
Trade and Industry, in case of nonagricultural product, commodity or article . . .
involving . . . safeguard measures under Republic Act No. 8800, where
either party may appeal the decision to impose or not to impose said
duties." 34 It is clear that any future attempts to advance the literalist position
of the respondents would consequently fail. However, since Republic Act No.
9282 has no retroactive effect, this Court had to decide whether Section 29
vests jurisdiction on the CTA over rulings of the DTI Secretary not to impose a
safeguard measure. And the Court, in its assailed Decision, ruled that the CTA is
endowed with such jurisdiction.
The key phrase remains "in connection with." It has connotations that are
obvious even to the layman. A ruling issued "in connection with" the imposition
of a safeguard measure would be one that bears some relation to the
imposition of a safeguard measure. Obviously, a ruling imposing a safeguard
measure is covered by the phrase "in connection with," but such ruling is by no
means exclusive. Rulings which modify, suspend or terminate a safeguard
measure are necessarily in connection with the imposition of a safeguard
measure. So does a ruling allowing for a provisional safeguard measure. So too,
a ruling by the DTI Secretary refusing to refer the application for a safeguard
measure to the Tariff Commission. It is clear that there is an entire subset of
rulings that the DTI Secretary may issue in connection with the imposition of a
safeguard measure, including those that are provisional, interlocutory, or
dispositive in character. 36 By the same token, a ruling not to impose a
safeguard measure is also issued in connection with the imposition of a
safeguard measure. STaAcC
Respondents would like to make it appear that the Court acted rashly in
applying a discarded precedent in Shaw, a non-binding foreign precedent
nonetheless. But the Court did make the following observation in its Decision
pertaining to Blue Cross:
Now, let us determine the maximum scope and reach of the
phrase "in connection with" as used in Section 29 of the SMA. A
literalist reading or linguistic survey may not satisfy. Even the U.S.
Supreme Court in New York State Blue Cross Plans v. Travelers Ins . 41
conceded that the phrases "relate to" or "in connection with" may be
extended to the farthest stretch of indeterminacy for, universally,
relations or connections are infinite and stop nowhere. 42 Thus, in the
case the U.S. High Court, examining the same phrase of the
same provision of law involved in Shaw, resorted to looking at
the statute and its objectives as the alternative to an
"uncritical literalism." A similar inquiry into the other
provisions of the SMA is in order to determine the scope of
review accorded therein to the CTA. 43
In the next four paragraphs of the Decision, encompassing four pages, the
Court proceeded to inquire into the SMA and its objectives as a means to
determine the scope of rulings to be deemed as "in connection with the
imposition of a safeguard measure." Certainly, this Court did not resort to the
broadest interpretation possible of the phrase "in connection with," but instead
sought to bring it into the context of the scope and objectives of the SMA. The
ultimate conclusion of the Court was that the phrase includes all rulings of the
DTI Secretary which arise from the time an application or motu proprio initiation
for the imposition of a safeguard measure is taken. 44 This conclusion was
derived from the observation that the imposition of a general safeguard
measure is a process, initiated motu proprio or through application, which
undergoes several stages upon which the DTI Secretary is obliged or may be
called upon to issue a ruling.
The Court likewise stated that the respondents' position calls for split
jurisdiction, which is judicially abhorred. In rebuttal, the public respondents cite
Sections 2313 and 2402 of the Tariff and Customs Code (TCC), which allegedly
provide for a splitting of jurisdiction of the CTA. According to public
respondents, under Section 2313 of the TCC, a decision of the Commissioner of
Customs affirming a decision of the Collector of Customs adverse to the
government is elevated for review to the Secretary of Finance. However, under
Section 2402 of the TCC, a ruling of the Commissioner of the Bureau of
Customs against a taxpayer must be appealed to the Court of Tax Appeals, and
not to the Secretary of Finance. AcDaEH
Besides, respondents' claim would also apply every time this Court is
compelled to settle a novel question of law, or to reverse precedent. In such
cases, there would always be litigants whose causes of action might be vitiated
by the application of newly formulated judicial doctrines. Adopting their claim
would unwisely force this Court to treat its dispositions in unprecedented,
sometimes landmark decisions not as resolutions to the live cases or
controversies, but as legal doctrine applicable only to future litigations.
This being the case, the qualifiers mandated by the Constitution on this
presidential authority attain primordial consideration. First, there must be a
law, such as the SMA. Second, there must be specified limits, a detail which
would be filled in by the law. And further, Congress is further empowered to
impose limitations and restrictions on this presidential authority. On this last
power, the provision does not provide for specified conditions, such as that the
limitations and restrictions must conform to prior statutes, internationally
accepted practices, accepted jurisprudence, or the considered opinion of
members of the executive branch. aHIDAE
The Court recognizes that the authority delegated to the President under
Section 28(2), Article VI may be exercised, in accordance with legislative
sanction, by the alter egos of the President, such as department secretaries.
Indeed, for purposes of the President's exercise of power to impose tariffs
under Article VI, Section 28(2), it is generally the Secretary of Finance who acts
as alter ego of the President. The SMA provides an exceptional instance wherein
it is the DTI or Agriculture Secretary who is tasked by Congress, in their
capacities as alter egos of the President, to impose such measures. Certainly,
the DTI Secretary has no inherent power, even as alter ego of the President, to
levy tariffs and imports.
Concurrently, the tasking of the Tariff Commission under the SMA should
be likewise construed within the same context as part and parcel of the
legislative delegation of its inherent power to impose tariffs and imposts to the
executive branch, subject to limitations and restrictions. In that regard, both
the Tariff Commission and the DTI Secretary may be regarded as agents of
Congress within their limited respective spheres, as ordained in the SMA, in the
implementation of the said law which significantly draws its strength from the
plenary legislative power of taxation. Indeed, even the President may be
considered as an agent of Congress for the purpose of imposing
safeguard measures. It is Congress, not the President, which
possesses inherent powers to impose tariffs and imposts. Without
legislative authorization through statute, the President has no power,
authority or right to impose such safeguard measures because
taxation is inherently legislative, not executive.
When Congress tasks the President or his/her alter egos to
impose safeguard measures under the delineated conditions, the
President or the alter egos may be properly deemed as agents of
Congress to perform an act that inherently belongs as a matter of
right to the legislature. It is basic agency law that the agent may not act
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beyond the specifically delegated powers or disregard the restrictions imposed
by the principal. In short, Congress may establish the procedural framework
under which such safeguard measures may be imposed, and assign the various
offices in the government bureaucracy respective tasks pursuant to the
imposition of such measures, the task assignment including the factual
determination of whether the necessary conditions exists to warrant such
impositions. Under the SMA, Congress assigned the DTI Secretary and the Tariff
Commission their respective functions 50 in the legislature's scheme of things.
There is only one viable ground for challenging the legality of the
limitations and restrictions imposed by Congress under Section 28(2) Article VI,
and that is such limitations and restrictions are themselves violative of the
Constitution. Thus, no matter how distasteful or noxious these limitations and
restrictions may seem, the Court has no choice but to uphold their validity
unless their constitutional infirmity can be demonstrated.
What are these limitations and restrictions that are material to the
present case? The entire SMA provides for a limited framework under which the
President, through the DTI and Agriculture Secretaries, may impose safeguard
measures in the form of tariffs and similar imposts. The limitation most relevant
to this case is contained in Section 5 of the SMA, captioned "Conditions for the
Application of General Safeguard Measures," and stating:
The Secretary shall apply a general safeguard measure
upon a positive final determination of the [Tariff] Commission
that a product is being imported into the country in increased
quantities, whether absolute or relative to the domestic production, as
to be a substantial cause of serious injury or threat thereof to the
domestic industry; however, in the case of non-agricultural products,
the Secretary shall first establish that the application of such safeguard
measures will be in the public interest. 51
Congressman Punzalan was cited as saying that the DTI Secretary makes
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the decision "to impose or not to impose," which is correct since the DTI
Secretary may choose not to impose a safeguard measure in spite of a positive
final determination by the Tariff Commission. Congressman Punzalan also
correctly stated that it is the DTI Secretary who makes the final decision "on the
recommendation that is made [by the Tariff Commission]," since the DTI
Secretary may choose to impose a general safeguard measure different from
that recommended by the Tariff Commission or not to impose a safeguard
measure at all. Nowhere in these cited deliberations was Congressman
Punzalan, or any other member of Congress for that matter, quoted as saying
that the DTI Secretary may ignore a negative determination by the Tariff
Commission as to the existence of the conditions warranting the imposition of
general safeguard measures, and thereafter proceed to impose these measures
nonetheless. It is too late in the day to ascertain from the late Congressman
Punzalan himself whether he had made these remarks in order to assure the
other legislators that the DTI Secretary may impose the general safeguard
measures notwithstanding a negative determination by the Tariff Commission.
But certainly, the language of Section 5 is more resolutory to that question than
the recorded remarks of Congressman Punzalan.
For the same reason that Section 5 is explicit as regards the essentiality
of a positive final determination by the Tariff Commission, there is no need to
refer to the Implementing Rules of the SMA to ascertain a contrary intent. If
there is indeed a provision in the Implementing Rules that allows the DTI
Secretary to impose a general safeguard measure even without the positive
final determination by the Tariff Commission, said rule is void as it cannot
supplant the express language of the legislature. Respondents essentially
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rehash their previous arguments on this point, and there is no reason to
consider them anew. The Decision made it clear that nothing in Rule 13.2 of the
Implementing Rules, even though captioned "Final Determination by the
Secretary," authorizes the DTI Secretary to impose a general safeguard
measure in the absence of a positive final determination by the Tariff
Commission. 59 Similarly, the "Rules and Regulations to Govern the Conduct of
Investigation by the Tariff Commission Pursuant to Republic Act No. 8800" now
cited by the respondent does not contain any provision that the DTI Secretary
may impose the general safeguard measures in the absence of a positive final
determination by the Tariff Commission. cSTCDA
Nonetheless, the Separate Opinion brings to fore the issue of whether the
DTI Secretary, acting either as alter ego of the President or in his capacity as
head of an executive department, may review, modify or otherwise alter the
final determination of the Tariff Commission under the SMA. The succeeding
discussion shall focus on that question.
The Tariff Commission does not fall under the administrative supervision
of the DTI. 70 On the other hand, the administrative relationship between the
NEDA and the Tariff Commission is established not only by the Administrative
Code, but similarly affirmed by the Tariff and Customs Code.
As repeatedly stated, the Tariff Commission does not fall under the
administrative control of the DTI, but under the NEDA, pursuant to the
Administrative Code. The reliance made by the Separate Opinion to those three
examples are thus misplaced. AIHaCc
The bare fact is that the administrative superstructure, for all its
unwieldiness, is mere putty in the hands of Congress. The functions and
mandates of the particular executive departments and bureaus are not created
by the President, but by the legislative branch through the Administrative Code.
82 The President is the administrative head of the executive department, as
such obliged to see that every government office is managed and maintained
properly by the persons in charge of it in accordance with pertinent laws and
regulations, and empowered to promulgate rules and issuances that would
ensure a more efficient management of the executive branch, for so long as
such issuances are not contrary to law. 83 Yet the legislature has the concurrent
power to reclassify or redefine the executive bureaucracy, including the
relationship between various administrative agencies, bureaus and
departments, and ultimately, even the power to abolish executive departments
and their components, hamstrung only by constitutional limitations. The DTI
itself can be abolished with ease by Congress through deleting Title X, Book IV
of the Administrative Code. The Tariff Commission can similarly be abolished
through legislative enactment. 84
Thus, if the Congress enacted the law so that the DTI Secretary is "bound"
by the Tariff Commission in the sense the former cannot impose general
safeguard measures absent a final positive determination from the latter the
Court is obliged to respect such legislative prerogative, no matter how such
arrangement deviates from traditional norms as may have been enshrined in
jurisprudence. The only ground under which such legislative determination as
expressed in statute may be successfully challenged is if such legislation
contravenes the Constitution. No such argument is posed by the respondents,
who do not challenge the validity or constitutionality of the SMA.
We see no reason to deviate from these observations, and indeed can add
similarly oriented comments. Corollary to the legislative power to decree
policies through legislation is the ability of the legislature to provide for means
in the statute itself to ensure that the said policy is strictly implemented by the
body or office so tasked with the duty. As earlier stated, our treaty obligations
dissuade the State for now from implementing default protectionist trade
measures such as tariffs, and allow the same only under specified conditions. 90
The conditions enumerated under the GATT Agreement on Safeguards for the
application of safeguard measures by a member country are the same as the
requisites laid down in Section 5 of the SMA. 91 To insulate the factual
determination from political pressure, and to assure that it be conducted by an
entity especially qualified by reason of its general functions to undertake such
investigation, Congress deemed it necessary to delegate to the Tariff
Commission the function of ascertaining whether or not the those factual
conditions exist to warrant the atypical imposition of safeguard measures. After
all, the Tariff Commission retains a degree of relative independence by virtue of
its attachment to the National Economic Development Authority, "an
independent planning agency of the government," 92 and also owing to its
vaunted expertise and specialization. IaSCTE
Even assuming that this prescribed setup made little sense, or seemed
"uncommonly silly," 93 the Court is bound by propriety not to dispute the
wisdom of the legislature as long as its acts do not violate the Constitution.
Since there is no convincing demonstration that the SMA contravenes the
Constitution, the Court is wont to respect the administrative regimen
propounded by the law, even if it allots the Tariff Commission a higher degree
of puissance than normally expected. It is for this reason that the traditional
conceptions of administrative review or quasi-judicial power cannot control in
this case.
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Indeed, to apply the latter concept would cause the Court to fall into a
linguistic trap owing to the multi-faceted denotations the term "quasi judicial"
has come to acquire.
Under the SMA, the Tariff Commission undertakes formal hearings, 94
receives and evaluates testimony and evidence by interested parties, 95 and
renders a decision is rendered on the basis of the evidence presented, in the
form of the final determination. The final determination requires a conclusion
whether the importation of the product under consideration is causing serious
injury or threat to a domestic industry producing like products or directly
competitive products, while evaluating all relevant factors having a bearing on
the situation of the domestic industry. 96 This process aligns conformably with
definition provided by Black's Law Dictionary of "quasi judicial" as the "action,
discretion, etc., of public administrative officers or bodies, who are required to
investigate facts, or ascertain the existence of facts, hold hearings, weigh
evidence, and draw conclusions from them, as a basis for their official action,
and to exercise discretion of a judicial nature." 97
However, the Tariff Commission is not empowered to hear actual cases or
controversies lodged directly before it by private parties. It does not have the
power to issue writs of injunction or enforcement of its determination. These
considerations militate against a finding of quasi-judicial powers attributable to
the Tariff Commission, considering the pronouncement that "quasi-judicial
adjudication would mean a determination of rights privileges and duties
resulting in a decision or order which applies to a specific situation." 98
Indeed, a declaration that the Tariff Commission possesses quasi-judicial
powers, even if ascertained for the limited purpose of exercising its functions
under the SMA, may have the unfortunate effect of expanding the
Commission's powers beyond that contemplated by law. After all, the Tariff
Commission is by convention, a fact-finding body, and its role under the SMA,
burdened as it is with factual determination, is but a mere continuance of this
tradition. However, Congress through the SMA offers a significant deviation
from this traditional role by tying the decision by the DTI Secretary to impose a
safeguard measure to the required positive factual determination by the Tariff
Commission. Congress is not bound by past traditions, or even by the
jurisprudence of this Court, in enacting legislation it may deem as suited for the
times. The sole benchmark for judicial substitution of congressional wisdom is
constitutional transgression, a standard which the respondents do not even
attempt to match.
Certainly, nothing in the SMA authorizes the DTI Secretary, after making
the preliminary determination, to personally oversee the investigation, hear out
the interested parties, or receive evidence. 100 In fact, the SMA does not even
require the Tariff Commission, which is tasked with the custody of the
submitted evidence, 101 to turn over to the DTI Secretary such evidence it had
evaluated in order to make its factual determination. 102 Clearly, as Congress
tasked it to be, it is the Tariff Commission and not the DTI Secretary which
acquires the necessary intimate acquaintance with the factual conditions and
evidence necessary for the imposition of the general safeguard measure. Why
then favor an interpretation of the SMA that leaves the findings of the Tariff
Commission bereft of operative effect and makes them subservient to the
wishes of the DTI Secretary, a personage with lesser working familiarity with
the relevant factual milieu? In fact, the bare theory of the respondents would
effectively allow the DTI Secretary to adopt, under the subterfuge of his
"discretion", the factual determination of a private investigative group hired by
the industry concerned, and reject the investigative findings of the Tariff
Commission as mandated by the SMA. It would be highly irregular to substitute
what the law clearly provides for a dubious setup of no statutory basis that
would be readily susceptible to rank chicanery.
Moreover, the SMA guarantees the right of all concerned parties to be
heard, an elemental requirement of due process, by the Tariff Commission in
the context of its investigation. The DTI Secretary is not similarly empowered or
tasked to hear out the concerns of other interested parties, and if he/she does
so, it arises purely out of volition and not compulsion under law. cADEHI
Indeed, in this case, it is essential that the position of other than that of
the local cement industry should be given due consideration, cement being an
indispensable need for the operation of other industries such as housing and
construction. While the general safeguard measures may operate to the better
interests of the domestic cement industries, its deprivation of cheaper cement
imports may similarly work to the detriment of these other domestic industries
and correspondingly, the national interest. Notably, the Tariff Commission in
this case heard the views on the application of representatives of other allied
industries such as the housing, construction, and cement-bag industries, and
other interested parties such as consumer groups and foreign governments. 103
It is only before the Tariff Commission that their views had been heard, and this
is because it is only the Tariff Commission which is empowered to hear their
positions. Since due process requires a judicious consideration of all relevant
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factors, the Tariff Commission, which is in a better position to hear these
parties than the DTI Secretary, is similarly more capable to render a
determination conformably with the due process requirements than the DTI
Secretary.
In a similar vein, Southern Cross aptly notes that in instances when it is
the DTI Secretary who initiates motu proprio the application for the safeguard
measure pursuant to Section 6 of the SMA, respondents' suggested
interpretation would result in the awkward situation wherein the DTI Secretary
would rule upon his own application after it had been evaluated by the Tariff
Commission. Pertinently cited is our ruling in Corona v. Court of Appeals 104 that
"no man can be at once a litigant and judge." 105 Certainly, this anomalous
situation is avoided if it is the Tariff Commission which is tasked with arriving at
the final determination whether the conditions exist to warrant the general
safeguard measures. This is the setup provided for by the express provisions of
the SMA, and the problem would arise only if we adopt the interpretation urged
upon by respondents.
This is balderdash, as with any and all claims that the Decision allows
foreign industries to ride roughshod over our domestic enterprises. The
Decision does not prohibit the imposition of general safeguard measures to
protect domestic industries in need of protection. All it affirms is that the
positive final determination of the Tariff Commission is first required before the
general safeguard measures are imposed and implemented, a neutral
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proposition that gives no regard to the nationalities of the parties involved. A
positive determination by the Tariff Commission is hardly the elusive Shangri-la
of administrative law. If a particular industry finds it difficult to obtain a positive
final determination from the Tariff Commission, it may be simply because the
industry is still sufficiently competitive even in the face of foreign competition.
These safeguard measures are designed to ensure salvation, not avarice.
Respondents well have the right to drape themselves in the colors of the
flag. Yet these postures hardly advance legal claims, or nationalism for that
matter. The fineries of the costume pageant are no better measure of
patriotism than simple obedience to the laws of the Fatherland. And even
assuming that respondents are motivated by genuine patriotic impulses, it
must be remembered that under the setup provided by the SMA, it is the facts,
and not impulse, that determine whether the protective safeguard measures
should be imposed. As once orated, facts are stubborn things; and whatever
may be our wishes, our inclinations, or the dictates of our passions, they cannot
alter the state of facts and evidence. 112
It is our goal as judges to enforce the law, and not what we might deem
as correct economic policy. Towards this end, we should not construe the SMA
to unduly favor or disfavor domestic industries, simply because the law itself
provides for a mechanism by virtue of which the claims of these industries are
thoroughly evaluated before they are favored or disfavored. What we must do
is to simply uphold what the law says. Section 5 says that the DTI Secretary
shall impose the general safeguard measures upon the positive final
determination of the Tariff Commission. Nothing in the whereas clauses or the
invisible ink provisions of the SMA can magically delete the words "positive final
determination" and "Tariff Commission" from Section 5.
VI. On Forum-Shopping
We remain convinced that there was no willful and deliberate forum-
shopping in this case by Southern Cross. The causes of action that animate this
present petition for review and the petition for review with the CTA are distinct
from each other, even though they relate to similar factual antecedents. Yet it
also appears that contrary to the undertaking signed by the President of
Southern Cross, Hironobu Ryu, to inform this Court of any similar action or
proceeding pending before any court, tribunal or agency within five (5) days
from knowledge thereof, Southern Cross informed this Court only on 12 August
2003 of the petition it had filed with the CTA eleven days earlier. An appropriate
sanction is warranted for such failure, but not the dismissal of the petition.
VII. Effects of Court's Resolution
Philcemcor argues that the granting of Southern Cross's Petition should
not necessarily lead to the voiding of the Decision of the DTI Secretary dated 5
August 2003 imposing the general safeguard measures. For Philcemcor, the
availability of appeal to the CTA as an available and adequate remedy would
have made the Court of Appeals' Decision merely erroneous or irregular, but
not void. Moreover, the said Decision merely required the DTI Secretary to
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render a decision, which could have very well been a decision not to impose a
safeguard measure; thus, it could not be said that the annulled decision
resulted from the judgment of the Court of Appeals.
The Court of Appeals' Decision was annulled precisely because the
appellate court did not have the power to rule on the petition in the first place.
Jurisdiction is necessarily the power to decide a case, and a court which does
not have the power to adjudicate a case is one that is bereft of jurisdiction. We
find no reason to disturb our earlier finding that the Court of Appeals' Decision
is null and void.
At the same time, the Court in its Decision paid particular heed to the
peculiarities attaching to the 5 August 2003 Decisionof the DTI Secretary. In the
DTI Secretary's Decision, he expressly stated that as a result of the Court of
Appeals' Decision, "there is no legal impediment for the Secretary to decide on
the application." Yet the truth remained that there was a legal impediment,
namely, that the decision of the appellate court was not yet final and
executory. Moreover, it was declared null and void, and since the DTI Secretary
expressly denominated the Court of Appeals' Decision as his basis for deciding
to impose the safeguard measures, the latter decision must be voided as well.
Otherwise put, without the Court of Appeals' Decision, the DTI Secretary's
Decision of 5 August 2003 would not have been rendered as well.
Accordingly, the Court reaffirms as a nullity the DTI Secretary's Decision
dated 5 August 2003. As a necessary consequence, no further action can be
taken on Philcemcor's Petition for Extension of the Safeguard Measure.
Obviously, if the imposition of the general safeguard measure is void as we
declared it to be, any extension thereof should likewise be fruitless. The proper
remedy instead is to file a new application for the imposition of safeguard
measures, subject to the conditions prescribed by the SMA. Should this step be
eventually availed of, it is only hoped that the parties involved would content
themselves in observing the proper procedure, instead of making a mockery of
the rule of law.
WHEREFORE, respondents' Motions for Reconsideration are DENIED WITH
FINALITY.
Respondent DTI Secretary is hereby ENJOINED from taking any further
action on the pending Petition for Extension of the Safeguard Measure. TIESCA
Separate Opinions
PANGANIBAN, J., concurring and dissenting:
Once again, this Court is faced with a controversy that ultimately affects
the economic life of the country. While on its face, the problem appears to be
merely one of legal construction of a statute, its consequences and implications
dig deep into the ability and power of the Executive Department to protect
domestic industries from injurious importations of foreign products.
Indeed, the main substantive issue of this case boils down to the dexterity
of the secretary of trade —” the government's principal official empowered to
superintend the nation's commercial life and to promote investments —” to
impose safeguard measures to protect the local cement industry from the
onslaught of unfair foreign competition.
Background Information
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Before the Court en banc are Motions for Reconsideration of the Decision
2 promulgated by this Court's Second Division, filed by 1) the Office of the
Solicitor General (OSG) on behalf of public respondents and 2) the Philippine
Cement Manufacturers Corporation (Philcemcor). 3 The assailed Decision
disposed as follows:
"WHEREFORE, the petition is GRANTED. The assailed Decision of
the Court of Appeals is DECLARED NULL AND VOID and SET ASIDE. The
Decision of the DTI Secretary dated 25 June 2003 is also DECLARED
NULL AND VOID and SET ASIDE. No costs."
The Decision of the Second Division also ruled that, pursuant to a literal
interpretation of Section 5 7 of the law (RA 8800), the DTI secretary could
impose a safeguard measure only upon a positive final determination by the
Tariff Commission. The Decision differentiated between the power to make a
final determination of the presence of serious injury or threat to the domestic
industry and the authority to impose the safeguard measure. It held that the
power to make a final determination was lodged in the Tariff Commission; and
the authority to impose the safeguard, in the DTI secretary.
The present Resolution written by the esteemed Justice Dante O. Tinga
upholds the assailed Decision in toto. I beg to differ.
While I agree that the CTA has jurisdiction to review the DTI secretary's
decision either imposing or not imposing a safeguard measure, I respectfully
disagree, however, that the said cabinet official is bound by the
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recommendations of the Tariff Commission and may thus impose a safeguard
measure only when it so recommends. I respectfully submit that the DTI
secretary has the power to impose safeguard measures even if the TC
does not recommend such imposition.
Petitioner's Arguments
Petitioner, on the other hand, agrees with the assailed Decision holding
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that the DTI secretary's ruling in either instance is appealable to the CTA.
Petitioner reiterates the interpretation that the phrase "in connection with" in
Section 29 of RA 8800 means "if it has connection with or reference to." Thus,
the DTI secretary's Decision not to impose a safeguard measure is reviewable
by the CTA, because it relates or has reference to the imposition of that
measure.
In addition, if the issues before us are left unresolved, they will most likely
crop up again in a similar application under the law. All the parties involved —”
the DTI, the Tariff Commission and the private entities —” would then still be in
a quandary with respect to whether the DTI head is bound by or may review
(and modify or reverse) recommendations of the Commission; as well as
whether the latter should make a final determination or simply submit its
recommendations. These questions of law would ineludibly be brought before
this Court again, creating unnecessary delays and expenses —” the undesirable
ills sought to be banished by the Court's oft-repeated policy of administering
justice efficiently, effectively and promptly.
Finally, the intent and spirit of the law is purportedly to protect domestic
industries from the ill effects of import surges. 41 According to the OSG, to hold
the DTI secretary bound to the Tariff Commission's negative determination
would deprive of any remedy a domestic industry suffering from serious injury.
42
In Philcemcor's view, "it is unthinkable that the DTI secretary is not free to
adopt his own independent judgment on" matters that "he considers as
erroneous conclusions arising from a flawed framework and methodology." 50
The department head's function would then be reduced to performing purely
ministerial acts rather than rendering decisions that require the exercise of
discretion. 51
Petitioner's Contentions
On the other side of the fence, petitioner insists that the DTI secretary is
empowered to impose safeguard measures only if the Tariff Commission makes
a positive final determination of the existence of the "core elements of a
safeguard situation." 52 Petitioner avers that the presence of those elements is
a conditio sine qua non for the imposition of a safeguard measure. The final
determination of their existence is allegedly conferred by law upon the
Commission, which was established and exists mainly to evaluate and impose
tariffs. In contrast, the DTI secretary has no competence or institutional
experience in dealing with tariff-related matters. 53
Petitioner also claims that the Tariff Commission exercises quasi-judicial
powers, as RA 8800 requires it "to make the final determination of the presence
or absence of the core elements for the imposition of a safeguard measure." 54
Such determination supposedly involves the application of the law to the facts
and results in the adjudication of the rights and obligations of the affected
parties. 55
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My Submission:
DTI Secretary Not Bound
by the TC's Recommendations
I agree with the OSG and private respondent.
I respectfully submit that the only constitutional way to uphold the DTI
secretary's imposition of tariffs under RA 8800 is to apply the alter ego
principle. In other words, the DTI secretary imposes safeguard measures (like
tariffs, import quotas, quantitative restriction, etc.) only in representation and
as an alter ego of the President in the field of trade and investment matters.
Thus, the law must be construed as delegating to the President —” through the
latter's alter ego on trade —” the power to impose safeguard measures.
Under the same Section 28(2) of Article VI of the Constitution, Congress
may specify "limitations and restrictions" on the President's authority to impose
tariff rates. However, such statutory limitations and restrictions must
themselves conform to the fundamental law. They cannot infringe, restrict,
limit, degrade or dilute the constitutional power of the President to control the
entire Executive Department.
The power of control includes the right to modify or set aside a decision of
a subordinate officer. Since the Tariff Commission is an agency in the Executive
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Department, it is necessarily subject to the control and supervision of the
President. Hence, its decisions and recommendations cannot tie the hands of
the Chief Executive with finality. Consequently, the DTI head, acting as the
President's agent pursuant to RA 8800, may affirm, modify or reverse the Tariff
Commission's recommendation. To repeat, such plenary power of control
cannot be restricted by a mere statute passed by Congress. 57
Let me now discuss my proposition in more detail.
In line with the above mandate, the DTI is tasked under RA 8800 to apply
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general safeguard measures, when warranted, to protect domestic industries
and producers from increased imports. 61
As the cabinet official and alter ego of the President on trade, industry
and investment-related matters, the DTI head necessarily has sufficient latitude
and discretion in the pursuit of the Department's mandate. On the other hand,
being primarily a fact-finder, the Tariff Commission is limited to submitting its
report and recommendations to the referring agency. In this scheme of tasking,
absent any clear and direct provision of the Constitution, the TC's mere
recommendation cannot bind the cabinet official, much less the President. As
the solicitor general aptly suggests, RA 8800 could not have intended that the
alter ego of the President be a mere rubber stamp who would be compelled to
enforce the recommendations of a purely investigatory agency in the Executive
Department. 67
As Chief Executive of the Republic, the President exercises control over all
executive departments, bureaus and offices. 68 Control is defined as "the power
of an officer to alter or modify or nullify or set aside what a subordinate officer
ha[s] done in the performance of his duties and to substitute the judgment of
the former for that of the latter." 69 The President's power extends to "all
executive officers from cabinet member to the lowliest clerk. It is at the heart of
the meaning of 'Chief Executive.'" 70
Pursuant to the power of control over subalterns, the President may
modify or set aside a recommended action of a subordinate office. Indeed, in
accordance with its investigatory findings, the Tariff Commission may
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recommend to the National Economic Development Authority (NEDA) an
increase in tariff rates in general; and the latter may in turn endorse the tariff
increase to the President who, however, is not bound to impose such increase.
The Chief Executive may, in the interest of the public, choose not to follow the
recommended action. So, too, may the alter ego, who merely acts as an
extension of the President.
The Tinga Resolution states —” erroneously, I submit —” that I advocate
the President's exercise of absolute and plenary control over subordinates,
such that the Chief Executive could order them to perform illegal or irregular
acts. I do not, and I have made no such preposterous statement. Needless to
state, the exercise of any power must be within the bounds of the Constitution
and law. True, Congress may reorganize the offices under the Executive
Department. It may even abolish or merge some of them. However, it cannot
abolish or restrict the President's constitutional power of control over executive
agencies and officials. The control power of the Chief Executive emanates from
the Constitution; no act of Congress may validly curtail it.
Neither am I asserting that the President's subalterns may control actions
of subordinate officials or agencies over which they have no direct functional
relationship as established by law. Such outlandish proposition would truly
produce absurd results. Indeed, the secretary of the Department of Science and
Technology (DOST) has no right to reverse the rulings of the Civil Aeronautics
Board (CAB) or the issuances of the Philippine Coconut Authority (PCA),
because there is no law granting the DOST secretary any power to do so. aIcDCA
These are the substantial conditions or limitations specified by the law for
the imposition by the DTI head (or, principally, the President) of a safeguard
measure. 74 The Tariff Commission is tasked to determine the presence of the
first two conditions —” matters that may be ascertained by factual
examination. The final factor is left to the discretion of the DTI secretary. Public
interest is something in which the public or community at large has some
pecuniary interest affecting their legal rights or liabilities. 75 Because it
concerns the general public, its determination is not quantifiable in exact
terms. There are no definite parameters by which it may be established solely
by judicial authorities. Its determination is indubitably a political question; thus,
it is addressed to a policy maker who is answerable to the people, not a fact
finder or investigatory body that has no electoral mandate. SHCaDA
The last item is important. The DTI secretary could not issue a decision
arbitrarily, without substantial factual and legal bases. In making a final
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decision —” whether to impose or not to impose a safeguard measure —” the
secretary is still bound by the conditions laid down in Section 5 of RA 8800. As
earlier mentioned, those limitations are as follows: the importation of a product
in increased quantities, whether absolute or relative to the domestic
production; an actual or a threatened serious injury to the domestic industry as
a result of increased importation; and the application of the safeguard measure
in the public interest.
These parameters should allay petitioner's fear of a violation of due
process in case of a reversal by the secretary of the negative determination by
the Commission. Both may have the same factual moorings on the basis of
which they may, however, have contrasting conclusions on the need for a
safeguard measure.
The ponencia even goes further by declaring that "nothing in the SMA
obliges the DTI [s]ecretary to adopt the recommendations made by the Tariff
Commission." 81 If the trade secretary can reject a positive final determination
of the Commission, what is the rationale behind binding him to a negative
determination by the same body? I cannot think of more illogic.
Toward these ends, I believe this Court must give domestic industries
every opportunity to seek redress through the most expeditious means
possible. On matters concerning policy questions, it must allow the political
departments ample chances to make the proper determinations within their
respective spheres of competencies. Be it remembered that in the imposition of
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safeguard measures, not only the analysis of technical data is involved but
likewise, and perhaps in a more crucial sense, the determination that it serves
the public interest. The proceeding does not merely relate to the settlement of
conflicting claims of private parties but, more important, the achievement of
the national policy to promote the competitiveness of domestic industries as a
whole. In short, we must give essence to the aim of the law to advance the
industrial development of the country.
In line with this aim, the doctrine on the exhaustion of administrative
remedies should be made to work out. After all, the administrative agencies of
the government, particularly the Department of Trade and Industry with respect
to safeguard measures, possess the necessary knowledge and expertise linked
up with policy concerns. The Department heads, especially because they serve
as alter egos of the President, should not be needlessly restricted in the
exercise of their discretion. It is they who best know how to address properly
the nonjudicial interests of the people. Thus, before resorting to courts, all
possible administrative means should be exhausted.
While on the topic of exhaustion of administrative remedies, may I add my
personal belief that the Decision of the secretary of trade should be appealable
to the President. 82 After all, the President cannot be deprived of the power to
review, modify or reverse actions of his or her alter egos. In the present case,
the Constitution expressly mentions the "President" as the official whom
"Congress may, by law, authorize" to impose "tariff rates, import and export
quotas, tonnage and wharfage dues, and other duties or imports." Thus, in the
Executive Department, the President should have the final say on such matters.
However, I shall not dwell at length on this point because it was not raised as
an issue by the parties.
Peripheral Issue:
Forum Shopping
With respect to the question on forum shopping, I also agree with the
Resolution of the Court that petitioner must answer for its failure to give timely
information to the Court of the Petition for Review that the former filed with the
CTA while the present case was pending here. But there being no showing of
willful and deliberate forum shopping, the Petition does not deserve outright
dismissal.
It should be recalled that pursuant to the June 5, 2003 Decision of the CA,
the DTI secretary immediately issued on June 25, 2003, a new Decision (this
time imposing a definitive safeguard measure), notwithstanding the Petition for
Review filed just two days earlier by Southern Cross Cement before this Court.
Hence, in view of its pending Petition here, petitioner filed with this Court on
July 7, 2003, a Very Urgent Application for a Temporary Restraining Order or
Writ of Preliminary Injunction, seeking to enjoin the DTI secretary from
enforcing his new Decision. In addition, pursuant to Section 29 of RA 8800,
petitioner filed before the CTA a Petition for Review of the June 25, 2003 DTI
Decision. Petitioner did not, however, give timely information to this Court of
the CTA Petition, in which the parties, causes of action, and reliefs sought were
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indeed the same as those in the instant Petition. 83 Hence, private respondent
filed a Manifestation and Motion to Dismiss this Petition, on the ground of forum
shopping.
The foregoing Rule behooved petitioner to inform this Court of any similar
action pending before any court, tribunal or agency within five days from
knowledge of the proceeding. Yet, petitioner did so only after 11 days, without
a satisfactory and justifiable explanation. TIDHCc
In sum, I submit that the CTA has jurisdiction over the DTI secretary's
decisions issued pursuant to RA 8800. Accordingly, the CA acted arbitrarily in
giving due course to private respondent's Petition for Certiorari seeking to set
aside the DTI secretary's April 5, 2002 Decision. Therefore, its June 5, 2003
Decision is void and has no legal effect.
Having ruled the CA Decision void, this Court should normally dismiss the
present Petition. However, because the remaining issue before it is purely legal
and imbued with public interest —” touching as it does upon the economic
security of our domestic industries —” it is proper for the Court to resolve it
once and for all, as an exception to the general rule. The resolution of this legal
issue now would avoid unnecessary delays and costs, consistent with the
Court's policy of prompt and proper administration of substantial justice.
Footnotes
1.Since renamed Cement Manufacturers Association of the Philippines. See Rollo , p.
1634. Considering that the Decision referred to the private respondents by
their old name, this Resolution shall do so as well, for the sake of continuity.
2.See Southern Cross Cement Corporation v. Philippine Cement Manufacturers
Corporation, G.R. No. 158540, 8 July 2004, 434 SCRA 65, 69-80.
3.See Tañada v. Angara, 338 Phil. 546, 556 (1997).
4.Supra note 2 at 69.
5.Philcemcor's application covered gray Portland cement of all types and excluded
white Portland cement, aluminous cement, and masonry cement. Rollo , p.
127.
6.In an Order dated 7 November 2001. Rollo , p. 128.
7.Id. at 303.
8.Id. at 334-341.
16.Id. at 82.
17.Rollo , p. 685. Prior to the promulgation of this new Decision, Southern Cross was
already apprehensive that the DTI Secretary might act favorably on
Philcemcor's petition in light of the Court of Appeals ruling. Southern Cross
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sent a letter dated 19 June 2003 to DTI Secretary Roxas, informing him that
Southern Cross would be appealing the Court of Appeals Decision to the
Supreme Court, and that "[w]e trust that, in accordance with the Rules of
Court, you will refrain from assuming jurisdiction or from taking any action on
the Application for Safeguard Measures filed by Philcemcor until after the
Supreme Court shall have finally decided on our appeal . . . ." See Rollo , pp.
679-680.
18.Id. at 688-690.
19.Id. at 681-699.
20.Id. at 775. The pleading's self-explanatory caption was "Reply to PHILCEMCOR's
Opposition (to Petitioner's Application for a Temporary Restraining Order
And/or Writ of Preliminary Injunction)."
21.Id. at 952-1005.
32.Before the passage of Republic Act No. 9282 on 30 March 2004, appeals from
the decisions of the Court of Tax Appeals was to the Court of Appeals.
33.Interestingly, while the Separate Opinion accedes to the majority ruling that the
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Court of Appeals had no jurisdiction over Philcemcor's petition considering
the availability of appeal to the Court of Tax Appeals, it makes the curious
statement that "[a]ccordingly, the present Petition, which seeks a review of a
void Decision of the CA should, in the ordinary course, also be dismissed.
Generally, this Court cannot review a legally inexistent judgment". Separate
Opinion, infra . In support of this proposition, the case of Velarde v. SJS , G.R.
No. 159357, 28 April 2004, 428 SCRA 283, is cited. However, a perusal of
Velarde, which was penned by the Separate Opinion's author, reveals the
Court's actual statement as follows: "Indeed, the assailed Decision was
rendered in clear violation of the Constitution, because it made no findings of
facts and final disposition. Hence, it is void and deemed legally inexistent.
Consequently, there is nothing for this Court to review, affirm, reverse or
even just modify." Velarde, id . Obviously, the averment in Velarde meant
that the Court would be hard put to review a decision that had no finding of
facts to evaluate, or a disposition to reverse, affirm or modify. However, as
transmuted in the Separate Opinion, it would now conclude that a "legally
inexistent" or void decision of the Court of Appeals, or any other court for
that matter, cannot be reviewed by this Court.
34.See Section 7, Republic Act No. 9282 (2004).
35.Rollo , p. 2435.
36.The Separate Opinion characterizes this statement as "loose", citing the legal
truism that interlocutory orders are not subject to an appeal or a petition for
review until the main case is finally resolved on the merits. However, Section
29 does not qualify which rulings of the DTI Secretary are exempt from
judicial review by the CTA. On the other hand, the provision states that all
rulings of the DTI Secretary issued in connection with the imposition of a
general safeguard measure, such as on whether provisional safeguard
measures are warranted even before the matter is referred to the Tariff
Commission. A ruling imposing a provisional safeguard measure is in a sense
interlocutory, since such ruling does not finally dispose of the case. Although
pending factual investigation by the Tariff Commission on referral by the DTI
Secretary, the ruling could produce financial damage and by reason thereof,
it is only fair that the party aggrieved may avail of judicial remedies even
during the investigation. The language of Section 29, despite the loose use of
the nomenclature "petition for review", allows such ruling on a provisional
safeguard measure, "interlocutory" as it may be, to fall within the ambit of
review of the CTA, which after all has the specialized competence to adjudge
the propriety of the provisional measure.
37.463 U.S. 85 (1983).
38.514 U.S. 645 (1995).
39.Rollo , p. 2437.
40.Ibid.
41.514 US 645 (1995).
42.Id. at 656.
43.Southern Cross, supra note 2, at 87.
44.Id. at 88.
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45.Cited as 295 SCRA 470 (1998).
46.Memorandum for Public Respondents dated 1 April 2005, p. 75.
47.Rollo , p. 2509.
48.Southern Cross, supra note 2, at 91.
49.Article VI, Section 28 (2), 1987 Constitution. Emphasis supplied.
50.As delineated under the SMA, the DTI (for non-agricultural products) and
Agriculture (for agricultural products) Secretaries are authorized under
Section 5 to impose the general safeguard measures upon a positive final
determination made by the Tariff Commission. Preliminary to such
imposition, the secretaries are authorized under Section 6 to conduct an
initial review of a petition for imposition of such measures, or motu proprio
initiate a preliminary safeguard investigation, and to impose a provisional
safeguard measure under Section 7 even before transmittal of the
application to the Tariff Commission for investigation. Upon a positive final
determination by the Tariff Commission, the Secretaries may, under Section
13, now choose which appropriate definitive safeguard measures to adopt.
Under Sections 18 and 19, the DTI and Agriculture Secretaries are similarly
tasked, in conjunction with the Tariff Commission, to act upon actions to
reduce, modify or terminate the existing safeguard measures, and to extend
or reapply such safeguard measures.
The Tariff Commission is empowered, upon referral of the application by the DTI or
Agriculture Secretaries, to conduct its investigation pursuant to Sections 9 to
11 of the SMA, and to arrive at its final determination of the existence of the
factual conditions listed under Section 5 and 12. It likewise is tasked to
investigate the factual basis for actions to reduce, modify, terminate, extend
or reapply the existing safeguard measures under Sections 18 and 19 of the
SMA. Its findings are to be contained in a report submitted to the DTI or
Agriculture Secretaries, under Section 14. Finally, pursuant to Section 20, it
likewise conducts an evaluation of the effectiveness of the actions taken by
the domestic industry after termination of the safeguard measures.
51.Section 5, Rep. Act No. 8800. Emphasis supplied.
52.While Section 5 denominates the DTI or Agriculture Secretary as the officer who
imposes the safeguard measures, it should be understood that they do so as
alter egos of the President, the person who is allowed by the Constitution to
be delegated the authority to impose tariffs and restrictions. Infra.
53.Rollo , p. 2398.
54.See Section 18, Article VII, Constitution, the provision which authorizes the
declaration of martial law. The only time the word "only" is used in the
provision is in the context of limiting the extent of the suspension of the writ
of habeas corpus. "The suspension of the privilege of the writ shall apply only
to persons judicially charged for rebellion or offenses inherent in or directly
connected with invasion."
55.Conducted on 28 September 1999. Punzalan, who died in May of 2001, was the
author of House Bill No. 7613, which eventually became the SMA.
56.Rollo , pp. 14-15.
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57.Particularly telling are the remarks of then Senator Raul Roco: "But the
Secretary does not act alone. There must be a positive finding by the
Commission." Rollo , p. 2818, and that of then Congressman Sergio Apostol:
"The final decision is in the choice of actions to impose rather than in the
choice of whether to impose or not despite a positive determination of
injury." Rollo , p. 2819. Interestingly, Southern Cross likewise cites the
comments of Congressman Punzalan similarly relied on by the petitioner.
58.As noted in the Decision, "it is easy to selectively cite passages, sometimes out
of their proper context, in order to assert a misleading interpretation . . .
Minority or solitary views, anecdotal ruminations, or even the occasional
crude witticisms, may improperly acquire the mantle of legislative intent by
the sole virtue of their publication in the authoritative congressional record."
Southern Cross, supra note 2, at 95. U.S. Supreme Court Justice Antonin
Scalia has been quoted as saying, "We are governed by laws, not the
intention of legislators." Conroy v. Aniskoff, 507 U.S. 511, 519 (1993), Scalia
J., concurring. He added that statements on the legislative floor even by the
bill's author or sponsor are not ratified by the legislative body as a whole and
thus do not reflect more than the individual desire of the person making the
statement. Ibid.
62.In fact, the remarks of Chairman Abon can even be construed the other way. He
speaks of the Commission as making recommendations, and indeed the
Tariff Commission is obliged to recommend what particular safeguard
measures to implement. The advice of the Commission on this point may be
highly persuasive, yet it does not bind the DTI Secretary. Nor would the Tariff
Commission have the power to implement the general safeguard measures.
However, the fact remains that the Tariff Commission must come out with a
positive final determination before the DTI Secretary may impose the general
safeguard measures.
63.Southern Cross, supra note 2 at 74.
77.See Section 47, Chapter 6, Title IV, Book IV, Administrative Code of 1987.
78.See Section 16, Chapter 3, Title XIV, Book IV, Administrative Code of 1987, in
relation to Chapter 3, Title XIV, Book IV of the same statute.
79.See Section 5, Chapter 1, Title XIV, Book IV, Administrative Code of 1987.
80.Separate Opinion, infra .
107.As U.S. Chief Justice Marshall once said, the power to tax involves the power to
destroy. McCulloch v. Maryland , 4 Wheaton 316, cited in Sison v. Ancheta ,
G.R. No. L-59431, July 25, 1984.
108."[T]axes being the lifeblood of the government, their prompt and certain
availability is of the essence." Id., citing Vera v. Fernandez, G.R. No. L31364,
March 30, 1979, 89 SCRA 199.
109.Lutz v. Araneta, 98 Phil. 148, 152 (1955); citing Great Atl. & Pac. Tea Co. v.
Grosjean, 301 U.S. 412, U.S. v. Butler, 297 U.S. 1; McCulloch v. Maryland,
supra note 96.
110.See I. Cruz, Constitutional Law, p. 46.
111.Supra note 3.
112.Attributed to the American President John Adams.
PANGANIBAN, J., concurring and dissenting:
1.Philippine Association of Service Exporters; Inc. v. Drilon , 163 SCRA 386, 393,
June 30, 1988, per Sarmiento, J.
2.434 SCRA 65, July 8, 2004.
1.May 22, 2001 —” Private respondent Philcemcor filed before the DTI an
application for the imposition of a safeguard measure on the importation of
gray Portland cement.
2.Nov. 7, 2001 —” DTI issued an Order imposing a provisional measure equivalent
to P20.60 per 40-kg bag of imported gray Portland cement, effective for 200
days from issuance by the Bureau of Customs (BOC) of the implementing
Customs Memorandum Order.
3.Dec. 10, 2001 —” BOC issued the pertinent Customs Memorandum Order.
4.Mar. 13, 2002 —” The Tariff Commission came out with its Formal Investigation
Report, in which it concluded that "[t]he elements of serious injury and
imminent threat of serious injury not having been established, it is hereby
recommended that no definitive general safeguard measure be imposed on
the importation of gray Portland cement."
5.Apr. 5, 2002 —” After noting that it was in disagreement with the TC's
recommendation, the DTI issued its Decision denying the application for a
safeguard measure, in accordance with that recommendation.
6.Apr. 22, 2002 —” Philcemcor filed before the CA a Petition for Certiorari,
Prohibition and Mandamus, praying. that the DTI Decision and TC Report be
set aside; and that the DTI secretary be directed to render an independent
judgment.
7.June 5, 2003 —” The CA promulgated its Decision holding that (a) it had
jurisdiction over the Petition for Certiorari, allegedly because of grave abuse
of discretion; and (b) the DTI secretary was not bound by the factual findings
of the TC, which were merely recommendatory. The CA remanded the case
to the DTI secretary for the latter to render a final decision in accordance
with RA 8800 and the Implementing Rules.
8.June 23, 2003 —” Southern Cross filed the present Petition, grounded on the
following: (1) the CA had no jurisdiction, the proper remedy being a petition
for review with the CTA; and (2) the TC's factual findings are binding upon
the DTI secretary.
9.June 25, 2003 —” the DTI secretary issued a new Decision, prescinding from the
CA Decision that it was not bound by the TC recommendation imposing a
safeguard duty of P20.60 per 40-kg bag of imported gray Portland cement for
3 years.
10.July 7, 2003 —” Southern Cross filed with the SC a Very Urgent Application for a
TRO or Writ of Preliminary Injunction, seeking to enjoin the DTI secretary
from enforcing the Department's June 25, 2003 Decision, in view of the
pending Petition before this Court.
11.Aug. 1, 2003 —” Southern Cross filed with CTA a Petition for Review of the June
25, 2003 DTI Decision.
12.Subsequently, Philcemcor filed before this Court a Manifestation and Motion to
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Dismiss this Petition, on the ground of forum shopping.
5."SEC. 29. Judicial Review. —” Any interested party who is adversely affected by
the ruling of the Secretary in connection with the imposition of a safeguard
measure may file with the Court of Tax Appeals, a petition for review of such
ruling within thirty (30) days from receipt thereof: Provided, however, That
the filing of such petition for review shall not in any way stop, suspend or
otherwise toll the imposition or collection of the appropriate tariff duties or
the adoption of other appropriate safeguard measures, as the case may be.
"The petition for review shall comply with the same requirements and shall follow
the same rules of procedure and shall be subject to the same disposition as
in appeals in connection with adverse rulings on tax matters to the Court of
Appeals."
20.§12, ibid.
21.Cosico Jr. v. NLRC, 338 Phil. 1080, May 23, 1997.
22.Ibid. (citing Commissioner of Internal Revenue v. TMX Sales, Inc., 205 SCRA
184, 187, January 15, 1992).
23.Philippine-Singapore Ports Corp. v. NLRC , 218 SCRA 77, January 29, 1993;
Velasco v. Ople, 191 SCRA 636, November 26, 1990; Solid Homes, Inc. v.
Payawal, 177 SCRA 72, August 29, 1989; Republic of the Philippines v.
Sangalang, 159 SCRA 515, April 8, 1988; Goodrich Employees Association v.
Flores, 73 SCRA 297, October 5, 1976.
24.Soliweg v. Workmen's Compensation Commission , 88 SCRA 569, February 27,
1979.
25.Ibid.
26.AFP Mutual Benefit Association, Inc. v. NLRC , 267 SCRA 47, January 28, 1997.
27.Velarde v. Social Justice System , 428 SCRA 283, April 28, 2004.
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28.Del Mar v. Philippine Amusement and Gaming Corporation , 346 SCRA 485,
November 29, 2000 (citing Fortich v. Corona, 289 SCRA 624, April 24, 1998;
Tano v. Socrates, 278 SCRA 154, August 21, 1997; Ramos v. CA , 269 SCRA
34, March 3, 1997).
29.372 SCRA 548, December 18, 2001.
30.Id., p. 565, per Kapunan, J.
31.307 SCRA 394, May 19, 1999, per Panganiban, J.
32.§4, Art. II of the Constitution.
33.§19, ibid.
34.§1, par. 2, Art. XII, ibid.
43.Philcemcor's (or CMAP's) Motion for Reconsideration, p. 11; rollo, Vol. IV, p.
2398.
44.§§5, 6, 7, 8, 13 & 17.
45.Joint Administrative Order No. 3, Series of 2000, issued by the secretaries of
Agriculture, Trade and Industry, and Finance; the Bureau of Customs
commissioner and the Tariff Commission chair.
46.E.g. TC Order No. 00-02.
47.Philcemcor's Motion for Reconsideration, p. 17; rollo, Vol. IV; p. 2404.
48.Id., p. 16.
49.§§1 & 2, Title X, Book IV of the Administrative Code; Article XII, Constitution.
50.Philcemcor's Motion for Reconsideration, supra, pp. 34-35 (citing an official
statement of the DTI secretary issued on April 1, 2002); rollo, pp. 2421-2422.
51.Other arguments of Philcemcor include the following. First, Congress delegated
to the DTI secretary the authority to prescribe safeguard measures, while
assigning to the Commission the task of providing the necessary support for
that function; but the ultimate responsibility for the proper exercise of the
delegated authority is lodged in the DTI head. (Motion for Reconsideration, p.
24; rollo, Vol. IV, p. 2411; and Memorandum, p. 14;) Second, under the
doctrine of implied grant of powers, "all powers necessary for the discharge
of the express powers are also granted, unless expressly withheld."
(Memorandum, p. 7.) The power of the DTI secretary to impose safeguard
measures is not legally conditioned on a positive recommendation by the
Commission; referral to the latter of the application and the holding of public
hearings are only part of the due process guarantee. Third, the imposition of
safeguard measures is primarily an exercise of the police power, not the
taxing power, of the State. The law's singular objective is to protect local
industries; thus, prior to the imposition of the measure by the DTI, the Tariff
Commission is tasked to ascertain the existence of injury or serious threat to
the local industry.
52.Petitioner quotes the following from private respondent Philcemcor's
Memorandum:
"The basic obligations of WTO Members under the Agreement on Safeguards are
the OBSERVANCE OF DUE PROCESS in the adoption and application of any
safeguard measure, AND THE NECESSITY OF A PRINCIPLED FINDING
ON THE PRESENCE OF THREE CORE ELEMENTS OF A SAFEGUARD
SITUATION. These core elements are the following: (a) that products from
one Member (the exporting country) of the WTO are being imported into the
territory of another Member of the WTO (the importing country) in such
increased quantities, absolute or relative to domestic production, and (b)
under such conditions as to cause or threaten to cause serious injury to the
domestic industry that produces like or directly competitive products; and (c)
the causal link between increased imports and serious injury or threat thereof
(Art. 2, para. 1, and Art. 4, para. 2(b), Agreement on Safeguards. . . . .)."
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(Emphasis supplied by petitioner.) Petitioner's Memorandum, p. 9.
53.Petitioner's Memorandum, p. 16.
54.Id., p. 39. Underscoring in the original.
55.Petitioner submits these other contentions:
1)To allow the DTI secretary to reject the positive final determination of the
Commission would result in an anomalous situation when it is the former
who initiates the proceeding pursuant to Section 6 of RA 8800. In that event,
the secretary will become the complainant and reviewing body at the same
time, a situation declared abhorrent by the Supreme Court. (Petitioner's
Memorandum, p. 16 [citing Corona v. Court of Appeals, 214 SCRA 378,
September 30, 1992]).
2)A modification or reversal by the DTI head of the Commission's final
determination will be a deprivation of the due process rights of the concerned
parties, who will not have the opportunity to be heard prior to the DTI's
action.
3)Making a distinction as to whether the imposition of a safeguard measure is an
exercise of police power or the power of taxation only serves to muddle the
issues, "for it has been settled that the taxing power may be used as an
implement of police power." (Id., p. 22 [citing Lutz v. Araneta, 98 Phil.
148, December 22, 1955]. Emphasis in the original). In any event, "police
power is lodged primarily in Congress, not the Executive, and . . . it is only by
virtue of a valid delegation by Congress that it may be exercised by the
President . . . ." (Id., p. 28 [citing Cruz, Isagani A, Constitutional Law, 1995, p.
44]).
56.City Government of San Pablo, Lacuna v. Reyes, 305 SCRA 353, March 25,
1999; Mactan Cebu International Airport Authority v. Marcus, 261 SCRA 667,
September 11, 1996.
57.Bernas, Joaquin G., SJ, The Constitution of the Republic of the Philippines, A
Commentary (1988), Vol. II, p. 205. ("Since the Constitution has given the
President the power of control, with all its awesome implications, it is the
Constitution alone which can curtail such power.")
58.Cruz, Isagani A, Political Law (1998), pp. 185-186.
59.67 Phil. 451, 463, 464, April 21, 1939, per Laurel, J.
60.Title X, Chapter 1, Book IV of EO 292.
61.§2, RA 8800.
62.§505(a) & (h), Tariff and Customs Code. Emphasis supplied.
63.§505(e), (f) & (g); ibid.
64.For instance, under Section 506 of the Tariff and Customs Code, the
Commission is tasked to give information and assistance to the President and
Congress; under Section 401, to recommend to the NEDA a tariff rate
increase.
65.§§7 & 9, RA 8800.
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66.§§9 & 14, ibid.
67.OSG's Motion for Reconsideration, p. 46.
68.§17, Art. VII of the Constitution.
69.Cruz, supra (citing Mondano v. Silvosa, 97 Phil. 143, May 30, 1955, per Padilla,
J.).
70.Bernas, supra, p. 204.
71.City of Ozamiz v. Lumapas, 65 SCRA 33, July 15, 1975. For instance, under §5,
Art. X of the Constitution, on local governments are directly conferred the
power of taxation within their respective area jurisdictions.
72.People v. Pinca , 318 SCRA 270, November 17, 1999 (citing Sotto v. Comelec, 76
Phil 516, 522, April 16, 1946); Pimentel Jr. v. House of Representatives
Electoral Tribunal, 393 SCRA 227, November 29, 2002.
73.§4(o) of RA 8800 defines serious injury as "a significant impairment in the
position of a domestic industry after evaluation by competent authorities of
all relevant factors of an objective and quantifiable nature having a bearing
on the situation of the industry concerned, in particular, the rate and amount
of the increase of imports of the product concerned in absolute and relative
terms, the share of the domestic market taken by increased imports,
changes in levels of sales, production, productivity, capacity utilization, profit
and losses, and employment."
74.Procedure-wise, the requirements are stated in §§6, 7, 9 & 10. For other
limitations, see §15.
75.F.B. Moreno, Philippine Legal Dictionary, 3rd ed. (citing Banco Filipino v.
Monetary Board, 142 SCRA 533, July 8, 1986).
76.Republic v. Sandiganbayan, 355 Phil. 181, July 31, 1998.
77.See §32, RA 8800.
78.See Cariño v. Commission on Human Rights , 204 SCRA 483, December 2, 1991;
Presidential Anti-Dollar Salting Task Force v. Court of Appeals, 171 SCRA 348,
March 16, 1989.
79.§2.
80.The OSG's Memorandum, pp. 28-29. See also Philcemcor's Memorandum, pp.
21-22.
81.Resolution, p. 32.
82.See Valencia v. Court of Appeals, 401 SCRA 666, April 29, 2003.
83.". . . [T]o determine whether a party violated the rule against forum shopping,
the most important factor to ask is whether the elements of litis pendentia
are present, or whether a final judgment in one case will amount to res
judicata in another. Otherwise stated, the test for determining forum
shopping is whether in the two (or more) cases pending, there is identity of
parties, rights or causes of action, and reliefs sought." Young v. Keng Seng,
398 SCRA 629, March 5, 2003. See also First Philippine International Bank v.
Court of Appeals, 252 SCRA 259, January 24, 1996.
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84.Chemphil Export & Import Corp. v. Court of Appeals, 251 SCRA 257, 291-292,
December 12, 1995; Ong v. Court of Appeals, 384 SCRA 139, July 5, 2002.
85.Barroso v. Ampig Jr., 328 SCRA 530, March 17, 2000; Sto. Domingo-David v.
Guerrero, 296 SCRA 277, September 25, 1998.
86.Barroso v. Ampig Jr., supra.
87.Top Rate Construction & General Services, Inc. v. Paxton Development
Corporation, 410 SCRA 604, September 11, 2003 (citing Benguet Electric
Cooperative, Inc. v. National Electrification Administration , 193 SCRA 250,
January 23, 1991; Villanueva v. Adre, 172 SCRA 876, April 27, 1989; Vda. de
Tolentino v. De Guzman, 172 SCRA 555, April 19, 1989.
88.There is grave abuse of discretion when an act is done contrary to the
Constitution, the law or jurisprudence; or when it is executed whimsically,
capriciously or arbitrarily out of malice, ill will or personal bias. Information
Technology Foundation of the Philippine v. Commission on Elections, 419
SCRA 141, January 13, 2004 (citing Republic v. Cocofed, 372 SCRA 462, 493,
December 14, 2001; and Tañada v. Angara, 272 SCRA 18, 79, May 2, 1997.
89.See Tatad v. Secretary of Energy, 346 Phil 321, November 5, 1997; Chavez v.
Public Estates Authority, 433 Phil. 506, July 9, 2002; Agan v. Philippine
International Air Terminals Co., Inc., 402 SCRA 84, May 5, 2003, and 420
SCRA 575, January 21, 2004; Francisco Jr. v. House of Representatives, 415
SCRA 45, November 10, 2003; Information Technology Foundation of the
Philippines v. Commission on Elections, supra.
90.Tañada v. Angara, 338 Phil. 546, 604-605, May 2, 1997.
91.Ibid.
92.See Panganiban, Liberty and Prosperity, a speech delivered before the 10th
National Convention of the Integrated Bar of the Philippines in Baguio City on
April 20, 2005.
93.Chavez v. Public Estates Authority, supra ; Agan v. Philippine International Air
Terminals Co., Inc., supra; Information Technology Foundation of the
Philippines v. Commission on Elections, supra.
94.See Panganiban, Leveling the Playing Field, 2004 ed., pp. 46-59.
95.La Bugal B'laan v. Ramos , GR No. 127882, December 1, 2004, per Panganiban,
J.